Property for Sale NZ
A question I’m frequently asked is what’s happening with property for sale in NZ.
The NZ residential property market, like those in all Western Countries, is greatly affected by the Global Financial Crisis.
The boom starting from 2003 came to a major halt part way through 2008.
Particularly hard hit were those with large mortgages as interest rates rose and job security was threatened. The preceding 3 or 4 years saw numerous individuals running seminars on the (paper) fortunes they were making buying properties on little or no deposits.
Like all investments, numbers on paper mean nothing until those numbers are realised upon sale. Once things began to slide, values plummeted and many realised they had been living in a false paradise.
Investors found themselves in trouble as developers went to the wall and rental guarantees proved worthless.
Print media advertising property for sale in NZ saw a huge increase in mortgagee sales.
As speculators exited the market, many properties struggled to find a buyer.
Property for sale in NZ went from being a national obsession to being of little interest to any other than owner/occupier buyers.
Over the past 4 years finance has been more difficult to access and central city skylines have been devoid of construction cranes.
Three and a half years later, there are still many market commentators predicting a further negative correction in residential property values in NZ.
We are a long way from seeing the end of the GFC but NZ has weathered the difficulties better than many countries and we are seeing confidence growing, particularly in Auckland.
Prices have risen in many city fringe suburbs to levels above the peak of 2007. Again, whether this is sustainable is the subject of conflicting debate between ‘experts’.
As expectations change, I believe we are seeing people changing from wanting large homes on their own section, usually found in the suburbs, to the more “European” lifestyle of apartments or terrace homes close to jobs and entertainment clustered around the CBD.
For this reason, I believe we are witnessing a long term trend within property for sale in NZ towards smaller more “lock up and leave” type properties.
As there is a 2 or 3 year lag between the decision to build, and having multiple storey or multi-unit developments available for occupation, I believe apartments and terrace houses will see a steep climb in value over the next few years.